Guardian Digital Communications Ltd. asked a London court to order lenders to vote on a plan to extend 1.73 billion pounds ($2.9 billion) of loans used to buy the U.K.’s emergency services communications system.
The owner of Airwave Solutions Ltd. wants to extend the loans due on April 22 by as much as five years, according to a company filing presented today. It is seeking to extend the debt using a “scheme of arrangement” process, which requires the backing of 75 percent of creditors. It must obtain a deal before a March 31 deadline to file its annual financial statements, the company said.
“If the scheme is not implemented, then it is likely that formal insolvency proceedings will be commenced,” a lawyer representing the company said in the filing. The plan “is the only realistic way to address the imminent maturity of the sums due,” it said.
Guardian Digital, owned by a fund controlled by Macquarie Group Ltd., needs to refinance at the same time as the British government is seeking to replace the network when contracts expire starting in 2016. The country’s police, fire and ambulance services want a cheaper, more advanced system than the service operated by Slough, England-based Airwave.
The company has a 1.48 billion-pound term loan A and 250 million-pound term loan B, according to the filing. It also has a 50 million-pound revolving credit facility, according to data compiled by Bloomberg.
Guardian Digital also owed 260 million pounds at the end of last year because of interest-rate swaps linked to the loans, it said. Liabilities associated with the contracts, which it will terminate as part of the extension plan, rank at the same level as the rest of the group’s debt, according to the filing.